EX-99.1 2 v06677_ex99-1.txt Exhibit No. 99.1 NEWS RELEASE COMPANY CONTACT: INVESTOR RELATIONS: Bill Bush Richard Cooper International Microcomputer Software, Inc. Strategic Growth International, Inc. 415.878.4039 212.838.1444 E-mail: bbush@imsisoft.com E-mail: rcooper@sgi-ir.com IMSI(R) ANNOUNCES ANNUAL RESULTS Company reports earnings per share of $0.03 on revenues of $12.0 million NOVATO, Calif., September 13, 2004 - IMSI(R) (OTC "Bulletin Board": IMSI), a leading developer and publisher of precision design, and consumer and business software solutions, today announced its financial results for the three and twelve months ended June 30, 2004. For the twelve months ended June 30, 2004, IMSI reported net income of $646,000, or $0.03 per share on net revenues of $12.0 million. Net income included gains from the sale of discontinued operations of $2.0 million and gains from marketable securities of $2.6 million. Net revenues from continuing operations increased more than fifty percent (50%) as compared to the previous fiscal year reflecting the strength of the precision design business and the acquisitions of Allume Systems, Inc. (formerly Aladdin Systems, Inc.) which was completed in the fourth quarter, and Houseplans, Inc. in November 2003. Net revenues from continuing operations for the three months ended June 30, 2004 were $5.3 million, an increase of over 150% as compared to the same period from the previous fiscal year. IMSI also reported net income of $96,000, or $0.01 per share, for the three month period ended June 30, 2004 as compared to $11.0 million, or $0.48 per share, from the same period in the prior year, which included a gain on the sale of ArtToday, Inc. of $12.2 million. The June 2004 quarter's results include gains from the sale of discontinued operations of $1.0 million and gains from marketable securities of $627,000. IMSI's strategy of acquiring growth companies has been successful in generating positive results as demonstrated by the growth in sales for the quarter and fiscal year. Had Allume been a part of IMSI for the entire fiscal year, annual revenues would have been in excess of $19 million. The process of integrating the companies is well under way and we expect to realize significant revenue and cost synergies beginning in our second quarter of fiscal 2005 ending December 31, 2004. Houseplans, Inc. which focuses on selling stock house plans, also continues to demonstrate positive results. The business now has an inventory in excess of 15,000 stock house plans and is seeing its average sales price and gross revenue continue to improve. With our traffic generation efforts and affiliate programs in place and beginning to take hold, Houseplans, Inc. is expected to continue to contribute positively to the company's consolidated results. "Our continued progress in the on-line distribution of software and content is evidenced by the successful introduction of the newest version of StuffIt , the strong results from Houseplans, Inc., which reported approximately $607,000 of revenue (a 27% sequential increase) in the current quarter, and the wide acceptance of our newest version of TurboCAD", said Martin Wade, IMSI CEO. "With the completion our acquisition of Allume, in the fourth fiscal quarter, we believe that we have significantly strengthened our utilities business which will help drive our long term financial performance. We continue to believe that these key strategic initiatives will result in long term shareholder value, even though they have come at the cost of current operating profits. With the doubling of our revenue run rate (refer below to our fiscal 2005 projections) and our plan to generate operating profits in the current fiscal year from cost cutting and operational efficiencies realized from the acquisition, we believe that IMSI is well positioned for the future. " "We plan to continue to identify and complete transactions aimed at optimizing operating performance," stated Gordon Landies, IMSI President. "The sale of Keynomics in July, at a gain, allows us to sharpen our focus on the company's core businesses which are the development and publication of software solutions and on-line content to consumers and small businesses. We intend to continue internally developing and acquiring products and services which we believe represent a strategic fit to our existing assets and strategy."
IMSI CONSOLIDATED STATEMENT OF OPERATIONS (Amounts in Thousands) Twelve Months Three Months Ended June 30, Ended June 30, 2004 2003 2004 2003 ------- ------- ------- ------- Net Revenues 11,985 7,785 5,295 1,931 Product Costs 4,137 3,947 1,736 1,303 ------- ------- ------- ------- Gross Margin 7,848 3,838 3,559 628 ------- ------- ------- ------- Costs and Expenses: Sales and Marketing 5,190 2,311 2,406 585 General and Administrative 3,910 2,903 1,627 1,565 Research and Development 2,519 1,358 1,083 295 ------- ------- ------- ------- Total Operating Expenses 11,619 6,572 5,116 2,445 ------- ------- ------- ------- Operating Loss (3,771) (2,734) (1,557) (1,817) Other Income (Expense) Interest Income (Expense), Net 18 (434) (27) (169) Foreign Exchange Gain (Loss) 9 60 (38) 37 Other (Expense) Income 51 (477) 0 (439) Realized Gain - Marketable Securities 585 0 509 0 Unrealized Gain - Marketable Securities 1,982 0 118 0 Gain (Loss) Disposal of Fixed Assets (13) 0 (13) 0 Gain on Sales of Product-line 59 (41) 0 (41) Gain from Extingushment of Debt 76 763 0 200 ------- ------- ------- ------- Total Other Income (Expense) 2,767 (129) 549 (412) ------- ------- ------- ------- Loss From Continuing Operations Before Taxes (1,003) (2,863) (1,008) (2,229) Income Tax Expense (Benefit) 38 7 13 (54) ------- ------- ------- ------- Net Loss From Continuing Operations (1,041) (2,870) (1,021) (2,175) Income (Loss) from Discontinued Ops (312) 1,301 117 896 Gain on Sale of Discontinued Ops 2,000 12,237 1,000 12,237 ------- ------- ------- ------- Net Income 646 10,668 96 10,958 ======= ======= ======= ======= Shares used in computing Basic and Diluted earnings per share 23,838 22,801 25,693 22,815 Loss per share from continuing operations $ (0.04) $ (0.13) $ (0.04) $ (0.10) Income (loss) from discontinued operations, net of income tax $ (0.01) $ 0.06 $ 0.01 $ 0.04 Gain from the sale of discontinued operations, net of income tax $ 0.08 $ 0.54 $ 0.04 $ 0.54 Net Income per share $ 0.03 $ 0.47 $ 0.01 $ 0.48
INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (In thousands, except share amounts) June 30, 2004 ASSETS Current assets: Cash and cash equivalents $ 3,212 Investment in marketable securities 2,151 Receivables, less allowances for doubtful accounts, discounts and returns of $958 2,522 Inventories, net of reserves for obsolescence of $123 1,122 Receivables, other (related to discontinued operations) 1,000 Note receivable from related party 350 Other current assets 552 Assets related to discontinued operations 828 -------- Total current assets 11,737 Fixed assets, net 637 Intangible Assets Capitalized software, net 2,748 Domain names, net 2,275 Distribution rights, net 594 Capitalized customer lists 843 Goodwill 7,559 -------- Total intangible assets 14,019 Other assets: Prepaid expenses 99 Investment in securities 1,771 -------- Total other assets 1,870 -------- Total assets $ 28,263 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Short term debt $ 3,557 Trade accounts payable 2,375 Accrued and other liabilities 1,751 -------- Total current liabilities 7,683 Liabilities related to discontinued operations 397 Long-term debt and other obligations 2,318 -------- Total liabilities 10,398 Shareholders' Equity Common stock, no par value; 300,000,000 authorized; 26,261,829 issued and outstanding 41,512 Accumulated deficit (23,577) Accumulated other comprehensive loss (70) -------- Total shareholders' equity 17,865 -------- Total liabilities and shareholders' equity $ 28,263 -------- Business Outlook IMSI's financial guidance is prepared in accordance with accounting principles generally accepted in the United States of America. The following forward-looking statements reflect IMSI's expectations as of September 13, 2004. Due to potential changes in general economic conditions and the various other risk factors discussed in IMSI's reports filed periodically with the Securities and Exchange Commission from time to time, actual results may differ materially. IMSI does not intend to update these forward-looking statements until its next quarterly results announcement, other than in other publicly available statements.
in millions expect for per share amounts Q1 Q2 Q3 Q4 Total -------------------------------------------------------------------------------------------------------------------------- Revenues $5.4 - 5.6 $5.9 - 6.3 $6.0 - 6.4 $6.2 - 6.5 $23.5 - 24.8 Net Income ($1.1) - (1.3) ($0.3) - (0.5) $0.2 - 0.4 $2.3 - 2.7 $1.1 - 1.3 Diluted Shares 26.5 26.7 27 27.5 27.1 -------------------------------------------------------------------------------------------------------------------------- Earnings/Loss per share ($0.03 - .05) $0.0 - (0.03) $0.01 - 0.03 $0.07 - 0.12 $0.05 - 0.07 --------------------------------------------------------------------------------------------------------------------------
About IMSI Founded in 1982, IMSI has established a tradition of providing the professional and home user with innovative technology and easy-to-use, high-quality software products at affordable prices. The company maintains two business divisions. The Precision Design division, anchored by IMSI's flagship product, TurboCAD(R) and the DesignCAD(TM) line, also develops and markets other visual content and design software such as FloorPlan(R) 3D and TurboCADCAM. The division also includes several online properties focused on the sale of content and services to the architectural, engineering and construction market thru its stock house plans site at Houseplans.com, its CAD add-on store, Cadalog.com and the online CAD symbol site, CADsymbols.com. The Consumer Software Solutions division, which is anchored by Allume Systems, Inc. (formerly Aladdin Systems, Inc.), provides small businesses and consumers with software solutions through its popular products such as StuffIt(R), Internet Cleanup(R), SpamCatcher(R), TurboProject(R), FormTool(R), FlowCharts&More(TM), HiJaak(R) and TurboTYPING(TM). More information about IMSI can be found at www.imsisoft.com and www.allume.com. Safe Harbor Statement This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of various factors including the ability of the company to successfully commercialize its new technologies as well as risk factors set forth under "Factors Affecting Future Operating Results" in the company's annual report on Form 10-KSB for the year ended June 30, 2004, and such other risks detailed from time to time in the company's reports filed with the Securities and Exchange Commission. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. # # #